Every state has its identified economy. The mainstay of any such economy however, varies from mono-cultural to multi-cultural products. A classic example of a mono-cultural product economy is sadly the Nigerian economy and the famous product is crude oil whose price in international market has crashed in recent time which explained why the benchmark of crude oil exports in 2016 federalbudget was put at $38.00 per barrel. Hard data from the National Bureau of Statistics have reportedly shown that Nigerian economy records 0.36% growth rate representing the lowest since 2004 with unemployment and inflation rates put at 12.1% and 13.7% respectively in 2016 which suggests the economy may be in recession. These statistics are scary and admittedly frightening to say the least. The questions that may agitate one’s mind therefore become: What went wrong? How and where do we go from here? These questions smack of the realities and get us down to the brass tacks staring us in the face since as a nation, we must not only exist but also seen to survive the hard times well and smartly too. The harsh economic realities in our country may not be compared to what Japan and Germany faced after the Second World War (1939-1945). Yet, these countries survived and why should Nigeria not survive after all if both the leadership and followership can put their arts together.
An English philosopher, Francis Bacon once said that “histories make men wise.” Accordingly, attempt to answer the first question above calls for a recourse to the annals of Nigeria’s nationhood. As a nation, Nigeria came into existence in 1914. For slightly over four decades of our existence as a nation, Nigeria thrived, flourished and prospered on agrarian economy directed by and under of the colonial administration. During this period, the three regions into which the nation was configured for ease and convenience of the colonial administration namely: northern, western and eastern regions thrived respectively on agricultural production of groundnuts (groundnut pyramid), cocoa and palm produce amongst other things which characteristically reflected their natural endowments and comparative advantages. The earnings generated from export of these precious cash crops were utilised in the running of administration of the regions and the central government and yet, healthy balances of trade and payments were also recorded. Interestingly, remarkable economic growth and development were recorded during the period. Each of these regions, statutorily remitted 50% of their revenue to the central government unlike what obtains today where States depend on federal allocations and bailouts to address recurrent issue as salary payments.
Immediately, crude oil was struck in commercial quantity in Oloibori in the present Bayelsa State in 1956 followed by attainment of independence shortly after in 1960, the glorious era miraculously changed so to speak. Consequently, agriculture – the erstwhile mainstay of Nigerian economy – became relegated to the background and the rent-seeking mentality founded on and fueled by free money from crude oil proceeds menacingly took over. The neglect of agriculture – our first love and source of pride –coupled with lip service paid to successive government policies on agriculture at all levels of government over the years, has conspired to bring our economy to its lowest ebb even as the price of crude oil continues to fall. Strong economies in the world are predicated one way or the other on agriculture as a major source of industrial inputs. Understandably, people in their different spheres of influence drive any economy and these people not only need to be fed but also feed well. One therefore finds it hard to understand why agriculture should be toyed or gambled with. America for example is a net exporter of grains and cereal in the world. Currently, our country is experiencing food shortages in varying degrees nationwide. If the prophesy of Prophet T. B. Joshua is anything to go by, it means that the nation will witness severe food scarcity towards the end of this year. This brings us to the second question raised early on which, again, could be likened to the question late musician and Evangelist, Sunny Okosun raised in one of his lyrics thus: “which way Nigeria?”
The answer, candidly, lies in diversifying the national economy away from crude oil through the instrumentality of Micro, Small and Medium Scale Enterprises (MSMEs) with emphasis on agriculture. Coincidentally, the present government of President Mohammadu Buhari, has provided a three-pronged agenda. This includes agriculture with the focal point on the mining sector, tackling the menace of insecurity because we need peace to ensure any modicum of development, and confronting corruption head-on which is a major anti-thesis to our socio-economic development as a nation. This agenda is quite huge for which one prays the government to succeed. However, government alone may not be able to prosecute this agenda to a logical conclusion with salutary effects. Hence, the need for all hands as individuals or groups to be on deck. This throws up the relevance of the role MSMEs in the whole equation of diversification of the economy. Needless to harp the fact that MSMEs constitute the engine room of many great economies the world over. The MSMEs exist in almost all sectors of the economy viz: extractive, manufacturing and tertiary services especially in the agricultural value chain. As catalysts of growing economies, the MSMEs need encouragement which has been lacking over the years. Without the peasant farmers, we may not have food supply to sustain the teeming populace of this country. Feel free to doubt this assertion.
Kudos to the Central Bank of Nigeria (CBN) and Nigerian Deposit Insurance Corporation (N DIC) for embarking on the training and certification of many operators of Microfinance banks through which funds ought to be channeled to the MSMEs in the country. The problems of access to funding therefore should be effectively resolved to allow MSMEs to take full advantage of the Microfinance policy launched in 2005 to empower themselves, and contribute to national development in terms of job creation and positive value additions to the gross domestic product (GDP). Owners of Micro, Small and Medium Enterprises are now much more exposed to the needed managerial expertise and experience to run their small businesses. The President should create time out of his crowded and busy schedule to interact and interface with operators of MSMEs from time to time as critical change agents in national development. American Presidents since 1963 do this every year through the U.S., Small Business Administration (SMA). It appears states that got bailouts to pay workers salaries are yet to pay back the bailout funds and it seems they may not even be able to pay it back given the reality of the falling price of crude oil. This goes to question the internal revenue generating capacities of the respective States. Major policies should focus on strategic targets with quantifiable benefits to avoid a situation where one pit is dug to fill another pit. The group of people that also actually deserves such bailout funds are the operators MSMEs as it would go a long way to help them to boost their respective productive ventures and thus, give vitality to our economy which at the moment lies almost prostrate and in dire need of critical bailout and stimulus.
Matthias Nkuda
